An elegant, detailed and accurate news site for those interested in the maritime business in the Southeastern United States, Caribbean and Central America

October 28, 2015

OCTOBER 28, 2015 — The National Transportation Safety Board said yesterday that searchers on board the Navy fleet ocean tug USNS Apache (T-ATF 172) had failed to locate the pinger of the lost U.S.-flag containership El Faro.

The second stage of the search will now start, attempting to find the vessel using side scan sonar.

The USNS Apache arrived at the last known position of the El Faro on October 23, and began searching for the vessel with a Towed Pinger Locator (TPL).

The search area consists of a 10 nautical mile by 15 nautical mile area, in which the USNS Apache towed the TPL on five search lines across the search area in order to detect the acoustic signal associated with the El Faro's pinger.

The USNS Apache concluded the first phase of the pinger locator search on October 26, 2015, with negative results.

The NTSB says that the TPL's ability to detect the El Faro's pinger may be affected by the orientation of the vessel as it lays on the sea floor or the current condition and functionality of the pinger.

The second phase of the search began yesterday, using the Orion side-scan sonar system. The second phase of the search will be conducted over the same search area. This phase will consist of 13 search tracks and will take about 14 days to complete. The side scan sonar system will be used to locate the El Faro, and if found, create an image of the vessel.

If the ship is found on the sea floor, its Voyage Data Recorder or "black box" can be retrieved to help investigators determine the El Faro's final moments. It is suspected that the ship sank in Hurricane Joaquin on October 1 and is lying on the sea bottom in 15,000 feet of water near the Crooked Islands in the Bahamas. All 33 onboard are presumed lost.

MIAMI - Datamyne (www.datamyne.com), a leader in global business intelligence based on multinational trade data, announced that it has completed the acquisition of Zepol Corporation, a Minneapolis-based provider of online trade data tools.

“As two tech start-ups launched over the last decade, Datamyne and Zepol helped redefine and revitalize trade data driven business intelligence,” explains Brendan McCahill, Datamyne CEO. “As one, we are positioned to claim leadership in the sector.”

“Both organizations are ranked among the top trade data providers in the highly competitive US market and are groundbreaking innovators in database access, research and analysis technologies,” McCahill says. “Together, our combined assets make us an industry powerhouse and advance our goal of being the world’s largest provider of global commercial trade information.”

McCahill will continue as CEO of Datamyne, and will also lead an integration team that includes Zepol CEO Paul Rasmussen. Zepol offices and data facilities will be incorporated in the Datamyne network.

“Global market dynamics demand that information providers offer a bounty of trade data content and resources. Joining Datamyne allows us to give our customers a view of global trade that is more comprehensive and more finely detailed,” says Rasmussen.

“We couldn’t be more excited to offer our customers the expanded resources of a now stronger company,” adds McCahill. “We expect the new talent and data assets in Minneapolis will help us accelerate product development and set the standard for decision-making support of global marketing, transport, logistics and supply chain management.”

October 07, 2015

OCTOBER 7, 2015—The U.S. Coast Guard has told family members of the crew of the lost cargo ship El Faro that it will suspend the search for survivors at 7 PM ET. The 790 ft containership is believed to have sunk en route from Jacksonville, FL, to San Juan, Puerto Rico, in Hurricane Joaquin on October 1. The ship is believed to have sunk near the CrookedIslands in the Bahamas in 15,000 feet of water. In its last contact with owner Tote Maritime, the ship had lost propulsion power, leaving it helpless in 140 mph winds and 50-foot seas.

There were 28 crew and 5 Polish nationals on board the ship when she left Jacksonville. No survivors have been found. One unidentified body in a survival suit was located in a debris field, but not recovered.

In a joint press conference held today by the U.S. National Transportation Safety Board (NTSB) and the U.S. Coast Guard in Jacksonville, CAPT Mark Fedor says that efforts to locate survivors had focused on two debris fields, one about 300 square miles and another about 70 square miles. The debris included various pieces of Styrofoam, parts of the ship, life rings, and life rafts. CAPT Fedor says, “We focused on debris that a survivor might cling to.”

The Coast Guard had informed the families of the crew of their efforts during daily briefings. Fedor praised the families for their courage saying it was "inspirational." He said despite going through a grieving process, “they asked how I was doing and Admiral Buschman was doing.” Rear Adm. Buschman is the Commander of the Coast Guard’s Seventh District.

The NTSB launched a go-team to Jacksonville to investigate the loss of the cargo ship El Faro on October 5. The team will be led by the NTSB’s Tom Roth-Roffy as investigator-in-charge. NTSB Vice Chairman Bella Dinh-Zarr accompanied the team and will serve as the principal spokesperson during the on-scene phase of the investigation.

In the press conference on Oct. 6, Vice Chairman Dinh-Zarr said the agency would leave “no stone unturned in its analysis.” It would be examining company e-mails, maintenance and inspection records, the design of the ship, and similar type vessels to determine the events leading up to and the cause of the loss of the ship.

The Coast Guard also said that it only received one hit off of the ship’s EPIRB on Oct. 1. A search will now focus on recovering the ship’s Voyage Data Recorder (VDR) or black box. The NTSB is in talks with the Navy to bring in the equipment to detect the signal from the VDR. The VDR is expected to have enough battery life to “ping” for about 30 days.

The El Faro, owned by Tote Maritime, was built in 1974 and updated in 1992 and 2006. It was carrying 391 containers and 294 trailers and cars.

October 05, 2015

The sinking of El Faro presents a major navigation hazard as partially submerged containers and other debris flow north in ocean currents.

The U.S. Coast Guard is no longer searching for the missing cargo ship El Faro but focusing on any signs of survivors. Searchers have found life rafts and survival suits, including one survival suit with human remains, Coast Guard Capt. Mark Fedor said Monday. The body inside the survival suit was unidentifiable, he said.

The U.S. Coast Guard believes the missing cargo ship El Faro sank, an agency spokesman told CNN. The search for the 33 people aboard continues, the Coast Guard said. Contact with El Faro was lost on Thursday.

The massive search for a container ship in the Caribbean Sea has yielded a 225-square-mile debris field, but no sign of the ship itself.

The vessel was carrying a crew of 28 Americans and five Polish nationals when it went missing near the Bahamas last week as Hurricane Joaquin, with winds blowing at 130 mph, passed over the archipelago.

El Faro, based in Jacksonville, Florida, was headed to San Juan, Puerto Rico.

The U.S. Coast Guard reported Sunday evening that it had discovered the 225-square-mile debris field, which consisted of Styrofoam, wood, cargo and other items.

The announcement came hours after the agency said searchers had found "multiple items," including an oil sheen, life jackets and containers in the same search area.

The company that owns the 790-foot ship, TOTE Maritime Puerto Rico, released a statement saying that a recovered container "appears to be from the El Faro," but according to the Coast Guard, there is no confirmation at this point that it or any of the other objects belong to the missing vessel.

"We located the objects via aircraft," explained Lt. Cmdr. Gabe Somma, who also said that Coast Guard cutters were still fighting the weather as they try to get to the ship's last known position, about 35 nautical miles northeast of the Bahamas.

The Coast Guard said Sunday evening that the search teams, which also include personnel and resources from U.S. Air Force and the U.S. Navy, have covered more than 70,000 square miles.

Still, no sign of El Faro or of any lifeboats, according to TOTE.

"With every passing hour, the search expands. When you're searching for something in the ocean, tracking the drift patterns and dealing with weather elements -- things are moving," said Somma, describing the challenges of the search.

Multiple search parties have been sent out by the Coast Guard, including two Air Force C-130 Hurricane Hunters, which are searching near the eye of the hurricane.

The last message the Coast Guard received from the El Faro said that the ship was beset by Joaquin, had lost propulsion and had taken on water, but had since contained the flooding. The ship was reportedly listing 15 degrees at that time.

The Coast Guard said in a press conference Friday afternoon that they were working to reestablish contact. The Coast Guard said 140 mph winds could have knocked out their communications equipment.

The waves in the area are 20 - 30 foot in height, and the ship, without power, is currently at the mercy of the waters.

All 33 crew members are members of the local chapter of the Seafarers International Union, the union confirmed to First Coast News. Twenty-eight are Americans, 5 are Polish nationals.

A photo of the conditions of pilots with the Coast Guard are facing while searching for El Faro. (Photo: US Coast Guard)

TOTE Maritime owns the ship, andannounced in a press releasethat they have reached out to the families of those on board and said they've given them an open line of communication for updates on the situation.

Freight forwarders that have taken over container supply chain management for blue-chip shippers could face a massive increase in liabilities their existing insurance policies may not cover.

Matthew Wilmhurst, an associate at UK law firm Holman Fenwick Willan, told the JOC’s Container Trade Europe event in Hamburg last week that changes in the way western retailers subcontract their supply chains, combined with the advent of ultra-large container vessels and vessel-sharing agreements between lines, has left many forwarders dangerously exposed.

“The change in the way western retailers are buying their freight services from freight forwarders is impacting forwarders’ position in the ULCV casualty context,” he said.

Traditionally, freight forwarders have acted under an agency agreement with the retailer, with a separate bill of lading contract signed between shipping line and retailer.

“The role of freight forwarder here was relatively simple,” said Mr Wilmhurst. “Arrange the sea carriage and perhaps arrange carriage at destination, as well as providing a few other value-added services.

“Under this model, the forwarder was only acting as an agent, so from an English law perspective his duty to his customer, the retailer, was limited to only in providing due skill and care in selecting the ocean carrier into which it puts its customer contract. From a legal perspective it’s an obligation which is pretty easy to discharge by putting the cargo with one of the major container lines.”

Because the forwarder wasn’t a party to that contract it did not have any further rights, obligations or liabilities to that contract and carriage.

However, Mr Wilmhurst added: “But that role is changing – retailers want forwarders to have greater control of the supply chain, which means there is a totally different contractual regime. Western retailers are consolidating their supply chains in order to leverage their buying power and using fewer people, and essentially they want one person they can claim against when things go wrong rather than lots of different shipping lines and perhaps lots of different hauliers.”

This has meant forwarders tend now to act as a one-stop shop and have set up non-vessel-operating common carrier subsidiaries to issue bills of lading, which legally means they are acting as the principal with the carrier, “so there is a slightly different contractual arrangement”.

“There is framework agreement between the retailer and forwarder, which uses its NOVCC to enter B/Ls contract of carriage with the carrier itself. So the forwarder is now assuming those contractual obligations and liabilities under the contract of carriage with the carrier and this where some of the problems for forwarders could arise,” he said.

Firstly, Mr Wilmhurst explained, these retailer-forwarder framework agreement normally contain KPIs on delivery times of imported cargo, which not only acts to benchmark performance across a contract period and is likely to be used for contract renewal, but also has the possibility of financial penalties for missing KPIs.

“With ULCVs, it means that more cargo for the freight forwarder will be carried on board one vessel, so when there is a casualty involving one of these ships there is likely to be a severe knock-on effect on these KPIs,” he said.

However, possibly more worrying for forwarders is their NVOCC arm entering into a contract with the container shipping line, with the B/L including a number of clauses about items such as misdeclared cargo and providing security for General Average and salvage.

“In terms of exposure on a ULCV, if you are talking about the loss of an entire 20,000 teu vessel and the cargo, you are looking at something well in excess of $1bn. I had a salvage claim on a 9,000 teu vessel in the last year where the combined value of the ship and cargo was just over $500m.

Under the traditional model, the forwarder was under no obligation to contribute to GA and salvage. Under general average rules the merchant – the shipper – has to provide security for General Average and salvage, and its cargo insurance typically relied on insurers to provide for that security.

Mr Wilmhurst said: “But under the new model, the forwarder is now responsible for that.

“However, many freight forwarders’ liability policies typically won’t respond to that type of demand. Many forwarders’ liability policies will not have the same obligation on the insurers, so forwarders are left in the difficult position of the container line asking for salvage security while the customer demands delivery of the cargo – but he has no mechanism whereby he can offer the same salvage and GA security.

“At the same time, shipowners can limit their liability outside of the normal regime but forwarders can’t, and forwarders could potentially receive very significant claims from customers because they are the principal, but what they are able to recover from the shipping line may be significantly less than what they pay out – and the larger the ship, the more cargo carried and the greater this problem will be,” he said.

He also warned that this could be exacerbated if cargo is carried on a vessel on which there are a lot of slot charter arrangements with other lines or are operated as part of an alliance.

“The forwarder also has no way of influencing the dispatch of cargo that is subject to a casualty. The VSA would have provision over General Average – when the line has to absorb it and when there needs to be a discussion with its VSA partners about whether they should declare GA.

“All the power is with the lines and VSA partners, not with the forwarder, who is effectively acting as a carrier – this is very difficult for forwarders and NVOCCs despite the fact they are controlling huge amounts of freight, but because they don’t own the assets they have no influence over what is happening on the ground.”

He did, however, suggest that the growing power of forwarders might lead to this balance of power being redressed.

“I suspect that forwarders and NOVOCCs, given the amount of contractual liability they are taking on and the huge increase in potential liabilities, will try and see that balance of power change somewhat,” he said.